Novo Nordisk has received approval from US regulators to market PrandiMet, a new combination drug for the treatment of type 2 diabetes.

PrandiMet is a combination of the Danish company's Prandin (repaglinide) and metformin and has been approved by the US Food and Drug Administration for glycaemic control in adults with type 2 diabetes who are already treated with a meglitinide (such as Prandin) and metformin or whose hyperglycaemia is not sufficiently controlled by either type of drug alone.

Jerzy Gruhn, president of Novo’s US subsidiary, said that with PrandiMet, physicians will have a simplified option for Prandin and metformin combination therapy". The combo will be marketed by Sciele Pharma later this year and Patrick Fourteau, chief executive of the latter firm, noted that many patients need more than one therapy to control their type 2 diabetes. PrandiMet “will give patients convenient access to two medications trusted for their efficacy and safety”, he added.

Goldman Sachs gives Novo a ‘buy’ rating
The PrandiMet approval came just as Goldman Sachs upgraded the stock to ‘buy’ from ‘neutral’. In a research note, analyst John Murphy said Novo shares have underperformed its peers by about 10% over the past three months, “providing an excellent entry opportunity” for long-term investors.

In particular, Mr Murphy thinks that the market has been overly-nervous about potential competitors to Novo's investigational glucagon-like peptide-1 (GLP-1) liraglutide. The firm presented strong data at the recent American Diabetes Association meeting in San Francisco which demonstrated that once-daily liraglutide, which was submitted to regulators on both sides of the Atlantic in May, provides statistically significantly better blood glucose control than Eli Lilly/Amylin’s twice-daily Byetta (exenatide).

Some investors are worried about the impact the once-weekly version of Byetta, which could hit the market by the end of 2009, could have on liraglutide, but Goldman Sachs notes that Novo will be approved well before then and will have time to build up market share. Mr Murphy concludedby saying that the firm’s limited patent concerns and significant exposure to the global diabetes epidemic make it a strong growth opportunity.